How the Chemical Industry Can Overcome Logistical Complexities

The chemical industry acts as a major contributor to the U.S. economy with more than $800 billion in sales. It accounts for nearly 14 percent share of the overall exports, with an approximate 881 million tons worth of material being shipped out every year.

Amidst No-Show Fines, Amazon Business and Brexit – The MRO & Logistics Landscape

The logistics sector has witnessed some sweeping changes in the sea and road freight sector. Overcapacity in the sea freight market has impacted profits of the ocean liners. Another reason impacting profits is the freight forwarders, who often commit to specific requirement to the liners, only to cancel (sometimes) at the last moment.

No-Show Fines and the New Contract for Sea Freight Carriers and Shippers

A few shipping liners have recently started implementing a no-show fine on all pre-booked shipments that fail to load on to vessels, with a few of them also charging for last minute cancellations or under-utilization of booked capacity. Maersk, CMA CGM and Hapag-Lloyd have implemented the no-show fines on select routes and, if successful, the fines are expected to be levied on all routes in next few months.

Impact of GST on the Logistics Industry

The Government of India rolled-out the much-anticipated Goods and Services Tax (GST) on the first of July, 2017. The “One Nation – One Tax” philosophy was conceived to streamline and ease the tax credit system. With a focus on eliminating the chaotic discrepancies in the taxation structure caused by the application of miscellaneous value-added taxes (VAT), GST seeks to introduce a common levy with the purpose of simplifying tax administration in the country. The implementation of GST is expected to benefit the logistics, fast-moving consumer goods (FMCG) and cement sectors.

Technology Adoption in the Logistics Sector

The global logistics sector is now adapting technology for efficient operations which, in turn, is helping their clients to save billions of dollars. This adoption of technology allows transparency and real-time situational awareness in addition to increasing efficiency in the system. Logistics companies have also been proactive in terms of technology adoption; for example, UPS in partnership with Fast Radius is planning to offer in-house 3D printing services for its clients. This is a big strategic move to ensure revenue sustainability and remain competitive with technologies like on-demand printing.

IoT and Its Impact on the Road Freight Industry

The Internet of Things (IoT) has gained momentum within the road freight industry over the past few years. IoT is defined as the internetworking of physical devices, also referred to as “connected devices” and “smart devices,” that enables the objects to collect and exchange data. According to a DHL and Cisco Trends report, IoT utilization in the supply chain and logistics industry could generate USD 1.9 trillion in value by 2025, out of the overall USD 8 trillion in IoT value generated globally.

Will Logistics Consolidation Accelerate in 2017?

A wave of mergers and acquisitions reshaped the logistics industry in 2016. With enterprises viewing it as a strategy to reduce debt or to add capacity, a string of acquisitions, especially in Q2 2016, kept the industry buzzing. In October last year, TransForce completed the acquisition of XPO Logistics’ truckload business Con-Way Truckload, and Truckload carrier Schneider announced the acquisition of Watkins & Shepard Trucking and final-mile delivery carrier Lodeso in June. Toward the end of August, Hanjin Shipping filed for bankruptcy protection, after months of trying to raise liquidity and restructure its debt.

Effective Reverse Logistics for Managing Increasing Apparel Returns

Returns of retail merchandise have grown by 66% in the past five years, supported by a steep increase in e-commerce. US apparel sales through e-commerce grew by staggering 19.7% in 2015, compared to 1.1% in-store sales. The National Retail Federation reported an average return rate of 11% for apparel retail in 2015, with a 20% increase in returns during the holiday season.

Ocean Freight Trends and Outlook for 2017

The year 2016 was tumultuous for the global shipping industry, as carriers were prone to financial pressures. This was true especially the first three quarters of 2016, due to factors such as freight rates dipping to their lowest levels since 2009, M&A, new alliances and the Hanjin bankruptcy, one of the largest container shipping bankruptcies in history. In 2017, however, ocean freight rates are forecast to increase due to factors such as supplier consolidation, increase in bunker prices and slower capacity growth. However, we believe that ocean freight rates will remain moderate due to the uncertain global economic environment.

European Warehouse Market Trends and 2017 Outlook

E-commerce and online retail are major drivers for the increase in demand for different types of warehouses ꟷ such as mega fulfillment centers (merchandise storage and pick-up), parcel sorting centers, local parcel delivery centers, dot.com warehouses (fulfillment of online orders), return processing centers and local delivery centers (for same-day deliveries).

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